Ko Olina aquarium wins new support
By Andrew Gomes
Advertiser Staff Writer
With support from a new state administration, a once-defeated tax-credit bill for financing an aquarium at Ko Olina Resort & Marina got off to a smooth restart yesterday with approval by a Senate tourism committee.
The bill would provide up to $75 million in tax credits to develop attractions and educational facilities that help draw visitors to Hawai'i and spur hotel development at the largely undeveloped West O'ahu resort.
An identical bill last year was passed despite opposition from the state Tax Department, but was vetoed by then-Gov. Ben Cayetano, who viewed the measure as a public subsidy primarily benefiting a private resort development.
Yesterday, the Tax Department, with new acting and deputy directors appointed by Gov. Linda Lingle, reversed its position on the bill. The administration also introduced its own carbon copy versions of the bill in both houses.
"What a difference a year makes," said committee chairwoman Sen. Donna Kim.
"This could be the year," added Sen. Sam Slom, a Republican who supports the bill introduced by Democrat Sen. Colleen Hanabusa.
The Department of Business, Economic Development and Tourism also praised the bill, the only piece of tax-credit legislation to garner support from the department.
The lone testimony in opposition came from the nonprofit Tax Foundation of Hawai'i, which generally opposes tax-credit legislation.
The bill heads next to the Senate Ways and Means Committee. A companion bill in the House has yet to be heard.
Ko Olina master developer Jeff Stone said he will need to line up new commitments from vacation accommodation companies to build and run hotel and time-share projects to fulfill his promise to create $700 million in construction work, 10,000 construction jobs, 2,000 permanent jobs and $186 million in new tax revenues over 10 years if the bill passes.
Last year Stone, in an attempt to convince Cayetano to sign the bill, delivered signed letters of intent from Hilton Hotels Corp. to co-develop a 340-room hotel and from Canada-based Intrawest Corp. to co-develop a 200-plus-room vacation club condominium, commercial village and expanded marina.
Stone said yesterday that Hilton and Intrawest remain interested, although their agreements expired. Outrigger Hotels & Resorts also is interested, he said. Ritz-Carlton has signed a letter of intent to be part of what Stone expects will be at least two hotel or time-share projects started promptly should the bill become law.
Florida-based development and planning firm EDSA, which last year agreed to build the tax-credit-financed aquarium and a marine science center, retained its commitment.
So has The Harry & Jeanette Weinberg Foundation, which agreed to donate land it owns at Ko Olina for the aquarium site.
Stone also told committee members yesterday that he will draw up a memorandum of understanding to ensure projects at Ko Olina, including existing resort operators such as Marriott, will train and employ workers from the economically depressed Leeward Coast.
The bill would provide a 100 percent tax credit up to $75 million for design, planning and construction work on an aquarium and marine mammal research facility from 2004 through 2009.
The state would spread credits out over several years by limiting refunds to $7.5 million a year. After 17 years, the state would receive half of the aquarium's taxable income.
Reach Andrew Gomes at email@example.com or 525-8065.